How the Economic Factors Influence the American Presidential Election Dissertation

There are several different factors that influence U.S. elections, in particular at the presidential level. Economic issue are usually among the most important influencers for any national-level election, but there are other factors as well. Among the President's duties are not only stewarding the economy, but handling foreign policy, so both of those issues will come into play. The economy of course in recent years has become so highly globalized that foreign policy plays a role in how the economy develops. This paper will take a look at the factors that drive U.S. elections, and in particular will examine how certain areas of the economy and foreign policy influence the election. Of note will be the relations with China, as that nation has played an increasing role in both the U.S. economic environment and the U.S. foreign policy environment in recent years. While elections are often seen as being decided on factors over which the President has little control, the reality is that economic outcomes are often shaped by public policy -- there just is not always an easy and direct connection between the action and the economic outcomes due to the other factors involved (Merrifield, 1993).

Drivers of Elections

Election observer FairVote.org notes the key factors that drive voter turnout relate to the structure of the election, voting laws, demographics and electoral competitiveness. U.S. elections, especially the Presidential elections, are hotly contested. Demographics are also going ot play a role, as certain demographics vote much more often than others. In particular, older people, and wealthier people vote more often than the poor, the young and many minority communities (FairVote.org, 2015). Demographics are particularly important because how voters react to certain economic and foreign policy issues will be in part characterized by their demographic makeup.

How people vote will also be affected by demographics, but also by a number of other factors. Voters look for candidates who share their views and their values on a number of issues. So race/ethnicity, geographic region, religion, gender and family status are all factors that affect voting patterns. In particular people like to vote for candidates to whom they relate, or share similar views on some of these key issues (U.S. History.org, 2015).

Beyond these factors, voters look to the state of the economy. They are more likely to vote for the opposition candidates when economic performance is poor -- note the way that the tanking economy in 2008 completely broke open the deadlock between Obama and McCain that had existed that summer, delivering a landslide victory for the opposition party in the election that November. When the economy is doing well, people are more oriented towards the status quo and when the economy is doing poorly they are more oriented towards changing the government (Eldred, 2012).

Steinhauser (2014) identified several other factors that were driving the 2014 midterm campaign. These included the prognosis for Obamacare, the President's approval rating, income and gender equality, and foreign policy with respect to global hot spots. Many of these issues are factors that are driven by or in some way relate to foreign policy. Among global hotspots, that is usually the Middle East, in particular given the conflicts in Iraq and Afghanistan. While there are geopolitical issues with China, foreign policy towards China is usually a background issue for voters, and does not in general sway voting patterns. Issues such as income equality are economic issues, so it is not just the major economic issues that are things people vote on, but specific niche issues within economics.

Economic Issues: GDP

There are a number of economic issues that become major voting issues. Usually, these relate to the major headline numbers -- GDP, unemployment, inflation and interest rates. Consumers will see these numbers, and quite frankly these numbers are among the easiest to understand. GDP is important because people see this as a sign that the nation is healthy and growing. In recent years, GDP growth has been driven by free trade. While the average voter knows next to nothing about trade policy they do understand when their buying power increases, which should be the natural consequence of Ricardian-style free trade that takes advantage of comparative advantage. The government has actively engaged at least since the Reagan years a policy of encouraging free trade, something that has allowed the American economy to grow rapidly over this period of time.

One of the more interesting dimensions of such a broad-based measure as GDP is that GDP can be volatile, and there are often times when the federal government only has limited influence over it. One study noted that political uncertainty with major trading partners can result in GDP volatility increases, and if prolonged can result in political uncertainty as well (Boutchkova, 2011). What this means is that nations that trade heavily have an imperative to maintain political stability. In other words, the U.S. has no incentive to see China destabilized because that would create GDP volatility in the U.S., given the massive volume of trade between the two countries. Likewise, China has no incentive to see destabilization in the U.S. either.

This mutual interest in maintaining stable trade between the two nations actually will bleed over into the foreign policy sphere. In particular, there are issues with respect to Taiwan and with respect to other maritime disputes in the South China Sea. The U.S. is usually positioned opposite to China in such disputes, as the U.S. underpins the other major powerbrokers in the region. While China will typically only make use of hard power to the extent that it wishes to defend its territory, no hard power beyond that will be expected. What is interesting is that no matter what the People's Republic thinks about Taiwan, the use of hard power against the island would result in wholesale destabilization of the region, something that is simply not in the best interests of either China or the U.S.

The U.S. is essentially in a permanent election cycle. Thus, there is limited incentive to do anything with respect to Taiwan, or other foreign policy issues that involve China, that would threaten the current economic order. That current economic order is highly profitable for both countries, which gives them both a high level of incentive to maintain the status quo, but particularly so during an election cycle, given the importance of political stability to economic stability, and economic stability to the health of American GDP.

Economic Issues: Unemployment

Americans understand unemployment. The fear of growing unemployment in 2008 created a strong motivation to vote Democrat, and that was before the worst of the unemployment hit the U.S. economy. Unemployment affects millions of voters directly, and when unemployment rates are high, this tends to be something that most Americans either are directly affected or that the know someone who is affected. Thus, unemployment is a major issue among the leading economic factors that contribute to voting policies (Toplin, 2014).

Now, with unemployment there is usually a direct trade-off with economic growth and trade policy. Offshoring has been a major issue for Americans for several decades, and a lot of this offshoring has been to China. Where America has lost jobs is with the opening of trade deals with foreign countries. This is the thing with comparative advantage -- it implies a restructuring of both economies, which will create some jobs and eliminate others. Much of America's manufacturing has been moved to China, where costs are lower. So while this delivers a higher GDP, and it provides for a constraint on inflation, the cost comes with unemployment. Restructuring the economy is a low process, and many workers whose jobs become obsolete are not skilled, and therefore have trouble finding other jobs. So unemployment is a big issue, and there are many who have made the direct connection between pursuing greater trade with China through pushing China into the WTO and removing trade barriers between the two nations and the loss of American jobs. In elections, candidates do not talk about China, but they do talk about creating jobs for Americans.

In theory, America's last several presidents all have a high respect for the principles of free trade, and they have recognized that freer trade is a powerful took for increasing wealth. Politicians are in particular aware of this because of the emphasis on voting patterns. Voters do not necessarily grasp the balance and subtlety of the issue, but they do understand the threat of losing jobs. This can affect foreign policy, because actions taken to protect jobs domestically -- such as trade barriers -- represent foreign policy decisions. The relationship between the U.S. And China has been characterized by a general unwillingness on the part of either country to undertake protectionist measures that would compromise their growing trade relationship.

Can U.S. Voters Influence Policy vis-a-vis China?

It is fairly evident that the vast majority of U.S. voters are not particularly skilled in economics or in international relations. So they certainly are…
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How the Economic Factors Influence the American Presidential Election. (2015, May 7). Retrieved December 19, 2018, from https://www.essaytown.com/subjects/paper/economic-factors-influence-american/5326245